Chinese rebar steel futures dropped more than 1 percent to pull back from five-week highs on Thursday as steel producers in China’s top steel-making city of Tangshan boost output despite the start of its winter pollution restrictions two weeks ago. Local officials in Tangshan have yet to issue precise orders on output curbs, prompting mills there to increase production since the start of October. The retreat in steel pulled iron ore prices away from a seven-month high hit earlier in the session.

Coking coal slipped, moving further away from a 13-month peak hit on Wednesday. Construction steel product rebar for January delivery on the Shanghai Futures Exchange closed down 1.2 percent at 4,108 yuan a tonne, after initially touching 4,220 yuan, its loftiest since Sept. 11.

Hot rolled coil , used in manufacturing, fell 2.4 percent to 3,854 yuan. January iron ore on the Dalian Commodity Exchange rose 0.7 percent to settle at 517.50 yuan per tonne, but well off the day’s peak of 532 yuan, its strongest since March 8. Firm demand and falling stockpiles of iron ore in China fuelled the commodity’s rally earlier in the day. Iron ore inventory at China’s ports reached 142.5 million tonnes last week, the smallest since December 2017, and down 12 percent from a record 161.98 million tonnes reached in June, according to data tracked by SteelHome consultancy. SH-TOT-IRONINV

China’s more flexible approach to industrial production curbs in winter by allowing regions to set their own restrictions is expected to spur demand for raw materials, traders said. It’s the second straight winter that China is implementing the curbs as part of its battle against pollution. “There’s good demand and this may last until the end of October,” said a Shanghai-based iron ore trader.

“The port stockpiles have already come down. As long as they will not rise in a big way that will not cause a big concern for the market,” he said.